A forum for associates to speak out about law firm issues

Billable hours: art or science?

This week’s topic covers billable hours. Conceptually, it is a simple system: attorneys are supposed to bill the time that they spend working on a case in six minute increments, and enter the amount of time they bill into a software program that tracks and organizes the time. Sound simple? Realistically, it’s not. In fact, billing time is more of an art form than a science, because it lacks precision and a uniform standard. Senior associates at some firms are being billed out as high as $600 per hour; every tenth of an hour is worth $100. How that time is calculated, over months or years worth of bills, adds up to real money.

Attorneys all have different methods for calculating their time. From ultra-precise to not precise at all, here’s the spectrum: calculating your time with a stopwatch, timer, or the built-in clock on some billing software; looking at your watch and writing down the time that you began work on a matter, and looking at it again when you stop work; not paying close attention but “estimating” the time in general blocks at the end of the day.

At one end of the spectrum, you have an attorney who calculates billable hours as strictly as possible: the stopwatch stops every time the phone rings about a personal matter, every time the secretary stops by to chat for a couple minutes about the weather, every time a 2 minute break is taken to use the bathroom, every time 30 seconds are taken to read a personal email that just came in.

On the other end of the spectrum, you have an attorney who calculates billable hours as loosely as possible: he convinces himself that he can somehow “remember” or “reconstruct” his hours for an entire month at the end of the billing cycle!

In the next post, I’ll go into further detail about the techniques that certain attorneys use in calculating billable time: positive versus negative calculations, rounding methods, travel time, and “thinking about the case while in the shower” time.

How do you calculate billable time? Should there be a national standard for calculating time? Even if there was such a standard, is it realistic to believe that it could be enforced?